Critical illness insurance pays a tax-free lump sum benefit upon the diagnosis of a critical illness after the survival period has been satisfied. In most cases, the survival period is 30 days. A basic policy typically covers heart attacks, life-threatening cancer, and strokes. You can also add coverage for other conditions or illnesses, including Alzheimer’s disease, loss of independent existence or multiple sclerosis, to name a few. Some companies also offer critical illness coverage for children to cover childhood-related critical conditions such as cystic fibrosis or cerebral palsy.